How does securities arbitration differ from traditional litigation?
Arbitration is similar to a court proceeding in that both involve filing a complaint (or statement of claim) and introducing evidence through the examination of witnesses or documents. In litigation, the proceeding is called a trial and the case is heard by a judge or jury. In arbitration, the proceeding is called a final hearing and the case is heard by a panel of arbitrators. The discovery process in arbitration is streamlined by the requirement that both sides produce mandatory discovery documents. Typically, there are no depositions in arbitration. Arbitration proceedings are on average concluded within 12-14 months. Claimants have a limited right to appeal the arbitration award, although appellate relief is available on a limited number of issues.
Securities arbitration cases are administered by the Financial Industry Regulatory Authority (FINRA). Commodities cases are generally administered by the National Futures Association (NFA). Proceedings may also be filed with the American Arbitration Association (AAA).
The benefits of arbitration over traditional litigation.
Arbitration is private. In securities arbitration cases, financial matters, including the amount of investment losses the Claimant incurred, is private. The pleadings and documents filed in the arbitration case will not be published with the exception of the final arbitration award, if rendered. Arbitration is also generally more expeditious and less expensive than a court proceeding. Furthermore, when brokers and broker-dealers are ordered to pay an award by an arbitration panel they must do so within 30 days or risk being barred from the industry.
Hanley Law Group is dedicated to prosecuting securities arbitration claims on behalf of investors. If you have lost money as a result of the misconduct of your broker or brokerage firm you may be able to recover your financial losses. Contact us today for a free initial consultation.